Greenwich Ct Rentals

Greenwich CT (&National) RENTALS

I went to a presentation not too long ago by Lawrence Yun, Ph.D (Chief Economist of the National Association of Realtors) on the state of the housing market and how it might apply to Greenwich CT real estate.  I wrote up a little summary on this a couple weeks ago that yo can find here. One of the charts I found interesting was this one:This chart shows the relative increase in price of real estate and cost to rent since 1980 for the nation. As you can see, up until approximately 2002 both rentals rates and cost of real estate grew as extremely similar rates. At this point home prices sky rocketd and rental rates continued its normal growth.  If I had this charge for just Greenwich, CT I'd be willing to bet the numbers and growth patterns would be extremely similar.  The problem with analyzing Greenwich real estate and Greenwich rentals is that there simply isn't enough data to do a proper macro-level analysis.Looking at the past 10 years we can see how home prices pulled away from rental rates and then dropped below rents about the same time that the market really crashed. Keep in mind the graph is showing growth rates (from the 1980 base line), not actual rental numbers. Although this graph isn't perfect I do believe it shows a simple view of relative demand towards purchases and rentals. Before the crash we were seeing serious demand for purchases and now we are witnessing demand for rentals.  As mentioned in my last rental post, demand for rentals could not be higher in Greenwich.  I'm a big believer that this is due to the cyclical nature of everyone needing housing for their family before the school year combined with the lack of financing ability in those that wanted to buy, but couldn't.  Some agents don't agree with my strong belief in my school-time-demand - regardless, we are witnessing unprecedented demand in rentals right now. At some point it will even out with home values, which means either rental rates will come down or values will come back up.  If you know the answer, please tell me...

Greenwich CT (& National) RENTALS

I went to a presentation not too long ago by Lawrence Yun, Ph.D (Chief Economist of the National Association of Realtors) on the state of the housing market and how it might apply to Greenwich CT real estate.  I wrote up a little summary on this a couple weeks ago that yo can find here. One of the charts I found interesting was this one:This chart shows the relative increase in price of real estate and cost to rent since 1980 for the nation. As you can see, up until approximately 2002 both rentals rates and cost of real estate grew as extremely similar rates. At this point home prices sky rocketd and rental rates continued its normal growth.  If I had this charge for just Greenwich, CT I'd be willing to bet the numbers and growth patterns would be extremely similar.  The problem with analyzing Greenwich real estate and Greenwich rentals is that there simply isn't enough data to do a proper macro-level analysis.

Looking at the past 10 years we can see how home prices pulled away from rental rates and then dropped below rents about the same time that the market really crashed. Keep in mind the graph is showing growth rates (from the 1980 base line), not actual rental numbers. Although this graph isn't perfect I do believe it shows a simple view of relative demand towards purchases and rentals. Before the crash we were seeing serious demand for purchases and now we are witnessing demand for rentals.  As mentioned in my last rental post, demand for rentals could not be higher in Greenwich.  I'm a big believer that this is due to the cyclical nature of everyone needing housing for their family before the school year combined with the lack of financing ability in those that wanted to buy, but couldn't.  Some agents don't agree with my strong belief in my school-time-demand - regardless, we are witnessing unprecedented demand in rentals right now. At some point it will even out with home values, which means either rental rates will come down or values will come back up.  If you know the answer, please tell me...

Greenwich CT Rentals

I'm starting to get some requests on rentals and felt that this would be a good time to talk about the rental market in Greenwich (including Cos Cob, Riverside, Old Greenwich and North Mianus).  There are essentially two types of rentals in Greenwich. One type is the family rental and the other is for people that don't have kids (clients that are either very young or empty nesters).  I'll explain in a second why I include the younger clients in the same pool as the older empty-nesters.  The reason that I split up the groups in this manner is that one (the family clients) is very cyclical, while the other is not.

The rental clients that don't have kids look throughout the year and don't care which school district they are in. This is very important to pay attention to as you will see when I start talking about the family rentals. These non-children Greenwich rentals normally end up closer to town and in areas like Lyon Farm. Demand for these units is fairly consistent throughout the year. Yes it gets slow around the holidays and in the coldest of winter times, but there is not near the cyclical behavior as we see in the family rentals.

Clients that are looking for family rentals have a fairly small period of time to jump.  The sole reason for this is the school year. Not many people are looking to move their children during the school year so we see a ton of activity in Greenwich rentals in the summer months when school is out. This cyclical behavior has little to do with the economy. That being said, the negative economic market can sometimes boost the rental industry. Last August the Greenwich rental market saw this happen. The rental Market in Greenwich in August 2011 could not have been hotter. I had several clients loose out on rentals after bidding the ask price! They lost out to people that offered more than the asking price and people that offered money the day it was listed.

This burst in activity was due to all of the families that had to be in by the school year (the September Greenwich rental market slowed down considerbly). This happens every year, but I think the spike was extra strong last year because there were more families finding themselves in the market for Greenwich rentals that originally wanted to buy, but could not get the financing or find the right home at the right price.

I think we might see another spike this coming summer. It will be awhile until we know. Just realize that if you are interested in renting for the  next 2012/2013 school year you'll want to wait until this summer to look at what comes on the market. All of those 2011 rentals won't turn over and become available until this spring/summer.

Greenwich CT (&National) RENTALS